RATING: VALUATION AND NEGOTIATION (art, science and communication): time to relax CCA (Check, Challenge, Appeal)
The valuation of property is never purely a science. Few properties could ever be described as identical and so it follows that the same valuation evidence cannot be applied directly to many properties without some form of adjustment and realistic application. Rather than being either black or white, there is always a grey area in valuation.
For Rating purposes, valuation evidence has to be taken at a specific point in time. The Antecedent Valuation Date (AVD). For the current Rating list, this is April 1, 2015.
Of course, for rating purposes, there is the additional matter of the “hypothetical tenant”—in other words, a tenant that doesn’t actually exist but must be assumed to exist when formulating an opinion of their rental bid—taking all factors into account.
As valuers, it is almost always impossible to find enough direct evidence on a specific date for a specific property. If it were, valuation would undoubtedly become a science (rather sadly taking the skill of the Valuer out of the equation and, of course, their negotiation skills)
In the real world, Valuers are required to seek evidence from a wider area over a wider timescale and adjust as necessary to apply to the property being valued. This is the “art” of valuation, the “stand back and look consideration”.
Rating valuation has never really given over to the “art” side of valuation. The Valuation Office compiles whatever rental evidence they can gather and compiles this to formulate a range of matrices based on age, size and broad location from which they adopt a “tone,” which is then applied to an entire valuation scheme. These can often cover thousands of properties over a wide area with little or no further adjustment.
Historically, an experienced Rating agent in negotiation with an experienced Valuation Officer could, more often than not, reach a fair agreement through reasonable negotiation, always over the telephone or face-to-face. Both could appreciate the “art” side of valuation.
So, even rating valuation was a science-art mix, with proper communication being the key.
This, of course, was before the advent of the new regime: Check, Challenge, Appeal (CCA)
Now the art has been lost, as has the communication essential for a reasonable approach and a fair agreement for the ratepayer.
Rating agents seemingly cannot provide any evidence other than that of a direct comparable from a single date in time (1st April 2015). This is because our opposite number is now an email address.
Yes, meet… CC********@VO*.UK
This is now what we Rating agents have to negotiate with. There is not even the name of the person on the other side of the valuation office who is behind the email.
Effectively, the stock response that we receive from cca service is that all evidence provided to them is:
“NOT COMPARABLE IN TERMS OF SIZE/AGE/LOCATION AND/OR IS BEFORE OR AFTER THE AVD ” (DELETE AS APPROPRIATE) “SO NO WEIGHT CAN BE ATTACHED TO IT”.
We can no longer work with the evidence we have to reach an agreement. We can no longer undertake proper negotiation, adjust the comparable with sound reasoning and discussion and reach sensible agreement.
Now it seems we must have a direct comparable where a piece of rental evidence can be derived from the 1st of April 2015 on a property exactly the same size, age, type, and location because nothing else seems to be considered. It’s impossible to negotiate properly with an impersonal email address. Matters are black or white.
This, of course, all falls into the hands of the valuation office, which sets rateable values based on their “tone” and then, in reality, refuses to justify or scrutinise them. They, of course, do not have to divulge their own rental evidence at the outset.
Under CCA, the “art” of valuation has well and truly gone along with the important element of proper communication. This, of course, is a huge disadvantage to the ratepayer, who are not only seemingly not entitled to know how the valuation office formulated their rating assessment but are now prejudiced from having them properly discussed.
It’s time to relax the CCA procedure, bring back some sensibility, and allow agents the opportunity to properly discuss an assessment on behalf of their clients.